Do You Have to Have Car Insurance? Alternatives by State

Here's a little secret about car insurance: You don't have to have car insurance in many states. Most states have an alternative to buying auto insurance.

What states do have are "financial responsibility" laws. These essentially say that you must have a way to compensate others if you cause an accident. The alternatives to car insurance are typically:

Posting a deposit or bond with the state.

"Self-insuring," usually for owners of more than 25 vehicles, such as rental car companies.

Most people either don't know there's an alternative to auto insurance or find it more convenient to buy car insurance than give the state a big wad of money.

Self-insuring means that you choose not to buy auto insurance because you have the money to pay any judgments against you arising out of use of your vehicles. To do this, you generally must get a certificate of self-insurance from the state. The department that issues self-insurance certificates varies by state.

New Hampshire is the only state without a financial responsibility law. But even in New Hampshire you have to buy car insurance if you cause an accident.

Here's a look at states that don't require car insurance and the other options.

Do you have to have car insurance? State laws for alternatives

State

Bond/Deposit?

Self-insurance?

Alabama

$50,000

For owners of more than 25 vehicles

Alaska

$50,000

For owners of more than 25 vehicles

Arizona

$40,000

For owners of more than 10 vehicles

Arkansas

No

For owners of more than 25 vehicles

California

No

For owners of more than 25 vehicles

Colorado

$35,000

For owners of more than 25 vehicles

Connecticut

No

For owners of more than 25 vehicles

Delaware

$40,000

For owners of more than 15 vehicles

District of Columbia

No

For owners of more than 25 vehicles

Florida

No

Available to anyone with a net unencumbered worth of at least $40,000 and financially responsible for potential losses

Georgia

No

Available for owners of one or more vehicles

Hawaii

No

Available to any motor vehicle owner

Idaho

$50,000 of which $15,000 is for property damage up to a maximum of $120,000 for five or more vehicles.

For owners of more than 25 vehicles

Illinois

No

For owners of more than 25 vehicles

Indiana

Before July 1, 2018, $40,000 in cash or securities that may legally be purchased by savings banks. Beginning July 1, 2018, $50,000 in cash or securities that may legally be purchased by savings banks.

No

Iowa

No

For owners of more than 25 vehicles

Kansas

No

For owners of more than 25 vehicles

Kentucky

No

For owners of more than 25 vehicles

Louisiana

$55,000

For owners of more than 25 vehicles

Maine

No

Available to owners of one or more vehicles

Maryland

No

No

Massachusetts

$40,000

No

Michigan

No

For owners of more than 25 vehicles

Minnesota

No

For owners of more than 24 vehicles

Mississippi

$15,000

No

Missouri

$60,000

No

Montana

No

For owners of more than 25 vehicles

Nebraska

$75,000

For owners of more than 25 vehicles

Nevada

No

For owners of more than 10 vehicles

New Hampshire

n/a

n/a

New Jersey

No

For owners of more than 25 vehicles

New Mexico

$60,000

Available to any vehicle owner

New York

$25,000

For owners of more than 25 vehicles

North Carolina

$85,000

For owners of more than 25 vehicles

North Dakota

No

Available to any vehicle owner

Ohio

$30,000

For owners of more than 25 vehicles

Oklahoma

$75,000

For owners of more than 25 vehicles

Oregon

No

For owners of more than 25 vehicles

Pennsylvania

No

Available to any vehicle owner

Rhode Island

$75,000

For owners of more than 25 vehicles

South Carolina

$35,000

For owners of more than 25 vehicles

South Dakota

$25,000

For owners of more than 25 vehicles

Tennessee

$65,000

For owners of more than 25 vehicles

Texas

$55,000

For owners of more than 25 vehicles

Utah

$160,000

For owners of more than 24 vehicles

Vermont

$115,000

For owners of more than 15 vehicles

Virginia

$50,000

For owners of more than 20 vehicles

Washington

$60,000

For owners of more than 25 vehicles

West Virginia

No

For owners of more than 25 vehicles

Wisconsin

$60,000

For owners of more than 25 vehicles

Wyoming

$25,000

For owners of more than 25 vehicles

Source: Property Casualty Insurers Association of America

Buying car insurance is the best route to drive legally for most people. If you're looking for cheap car insurance, some of the ways to get it are to: